Generation Z, or Gen Z, accounts for a little over a third of the world’s population and has a significant impact on our economy. There are about 2.47 billion people worldwide between 10 and 25 years old – included in this group is Generation Z. Forty percent of global consumer spending can be attributed to Gen Z’ers, despite their young age.
Although Millennials still represent the largest group of consumers and Baby Boomers hold the greatest buying power, Gen Z's spending power is on the rise. In order for brands to remain successful, it is pivotal to understand where Gen Z is spending their $360 billion in disposable income. Find out here how Gen Z’s spending habits differ from other generations and how app marketers can capture the attention of these young users.
Getting to Know Gen Z
Getting to know your target audience is a key step in a successful app marketing strategy. The secret to winning Gen Z users starts with understanding their interests and values. Overall, Generation Z is known for being socially responsible, outspoken, unique, and of course, possessing significant buying power. They are often described as an educated generation that advocates for the environment and social justice issues.
Knowing the characteristics of the Gen Z population helps to inform marketing decisions around their spending habits. Taking into account where Gen Z is spending their time and what they are passionate about helps marketers create personalized and relevant content for this young generation.
Where Gen Z Spends Time
Mobile Natives
The Gen Z generation is the first generation to have grown up with smartphones truly integrated as a part of daily life. Fifty five percent of Gen Z’ers use smartphones for five or more hours a day and 26% use them for more than ten hours a day. Gen Z accounts for almost 40% of total mobile users and are much more likely to shop using their smartphone than tablets or desktop. In fact, 68% of Gen Z consumers shop on their mobile phones up to 4 times a week.
Gen Z’ers are mobile experts, and therefore more receptive to innovations in the mobile space compared to older generations. Over 50% of Gen Z’ers prefer rewarded mobile game advertisements over generic social media or search advertising. Because Gen Z’ers respond best to new innovations, creating personalized ads with short videos or gifs work best for reaching and winning over these young users.
Social Media Influence
Since its conception, social media has evolved into an extremely impactful platform for younger generations. Staying connected with peers, trends and influencers is a part of a Gen Z’s social upbringing. Not only does social media impact Gen Z, but 97% of this generation uses social media as their top source of shopping inspiration. On top of this, three out of four Gen Z shoppers want brands they follow on social media to connect with them about new products and promotions.
Social media remains an immensely important part of the app marketing process. More than 60% of users on TikTok purchase products advertised by brands on that platform. Finding these young users on the platforms they are already on is an important tool in winning their business. The global social commerce market is expected to grow to reach $3.4 trillion by 2028, capturing Gen Z’s attention through social media is an impactful way to capture that spend and build revenue for app marketers.
Gen Z Spending Habits
Applying learnings ofGen Z’s passions and interests will help marketers engage this younger generation and tap into their growing buying power. Augmented and virtual reality interest, higher standards and adapting in a face paced environment are all habits to consider when targeting this high spending user group.
Augmented Reality
Augmented reality (AR) and virtual reality (VR) technology are becoming increasingly common, especially in apps. Industries such as retail are using virtual reality to showcase their products and engage their consumers on mobile . Tourism companies take advantage of AR and VR within their apps to transport their users to tropical destinations with a tap of their screens. Additionally, healthcare companies are also using augmented reality but instead to help medical students practice certain procedures from the safety of their smartphone.
Ninety percent of Gen Z’ers claim that they are interested in using AR to see what objects or products will look like if purchased. In order to make an app exciting for this younger generation, implementing augmented or virtual reality into the platform is a required element to stand out from competition. Shopping apps should consider creating ways for users to virtually try on their clothing by simulating the product on the user or wherever the product is meant to be placed. Gaming apps can incorporate elements of augmented reality as well so that users can feel fully immersed in the game.
Need for Speed
The Gen Z generation has grown up in a fast-paced and technologically focused age. Anything and everything can be delivered within minutes of placing an order. On average, Gen Z shoppers will pay 5% more than the value of their purchase if it means that it will be delivered in under two hours. To win over this “get it now” group, making sure that an app not only offers a quick turnaround time for deliveries but also has a seamless interface providing a customer flow to purchase be immediate and succinct.
High Standards
Younger consumers increasingly back their beliefs with their shopping habits and favor brands that are aligned with their values. Despite being notoriously price conscious, over 64% of Gen Z’ers admit that they are willing to pay more for sustainable alternatives, proving the value of global benefit to outweigh any conservative price tag focus.
Brands that wish to be successful in capturing the younger generation, specifically Gen Z, will need to take a look at their brand’s environmental impact. Make sure that marketing messaging reflects your mission and lets consumers know that higher prices may be a direct correlation to sustainability goals.
Takeaways of Winning the Gen Z Market
Generation Z, or Gen Z, accounts for a little over a third of the world’s population and has a significant impact on our economy. Forty percent of global consumer spending can be attributed to Gen Z’ers, despite their young age. In order for brands to remain successful, it is pivotal to understand where Gen Z is spending their $360 billion in disposable income.
Gen Z Spending Habits
- Augmented Reality: Ninety percent of Gen Z’ers claim that they are interested in using AR to see what objects or products will look like if purchased. In order to make an app exciting for this younger generation, implementing augmented or virtual reality into the platform is a required element to stand out from competition.
- Need for Speed: On average, Gen Z shoppers will pay 5% more than the value of their purchase if it means that it will be delivered in under two hours. To win over this “get it now” group, making sure that an app not only offers a quick turnaround time for deliveries but also has a seamless interface providing a customer flow to purchase be immediate and succinct.
- High Standards: Over 64% of Gen Z’ers admit that they are willing to pay more for sustainable alternatives, proving the value of global benefit to outweigh any conservative price tag focus. Brands that wish to be successful in capturing the younger generation will need to take a look at their brand’s environmental impact.
